by Allen Morris
Dr. Ray Perryman, a native of Lindale, came home to East Texas on January 9th, to deliver his thoughts on the economic outlook facing the nation, Texas, and more specifically, about what those of us living in East Texas can anticipate. It was raining as Perryman arrived at the W. T. Brookshire Conference Center for a news conference prior to the luncheon. At thirty-five degrees, it was the coldest conference of the past forty-one years. The warmest conference on record was eighty-three degrees.
On the day of the 2025 Economic Conference, out-of-control fires were devastating Southern California, and it had been announced that firefighters were running out of water to combat the blaze; prompting the first question, “What is the water situation in Texas?” According to Perryman, the simple answer is that, “Overall, the state maintains a positive water position.” However, he cautions that we must think in terms of improving conservation of our most important natural resource through more efficient usage. “Agriculture represents only 1% of our gross product, but consumes 72% of our non-reclaimable water supply.” Locally, our water supply is one contributing factor for new businesses to relocate to East Texas. Other core contributing factors attracting new business to our region include population growth, housing, energy, transportation, and distribution; and the factor Perryman considers the most important – education.
Perryman stated that “more workers equal more growth.” During the past year, growth in Texas went from 1.5% to 1.8%, which translates to 536,000 new residents in the state, an average of roughly 1,540 new arrivals daily. “This presents challenges in each of the core areas affecting growth in East Texas,” Perryman said. “As energy demands increase, it is necessary to construct additional lines to move that energy. The estimated shortfall cost to achieve that in the next ten years is $13 billion.” He pointed out that as of August 23, 2025, our energy demand will be consuming 85 Megawatts of power. “The demand in the next five years will exceed 140 Megawatts.”
The reason Perryman considers education to be the most critical core contributor is because the future demands will fall on the next generation. “We must ensure that the next generation is properly prepared for their role in shaping the next fifty years of progress for
Texas. Education is the key to ensuring that preparedness,” according to Perryman. Part of the challenge for education is funding. “The state has a surplus account with $21 billion in it. To use that money for education will require 76 votes in the state house and 16 votes in the senate. But, even if the state legislature reacts, it won’t be enough. We still need the private sector to step up.”
As a new administration takes over the White House, there has been a great deal of rhetoric regarding immigration, and in particular, slowing the influx of immigrants (whether they are called undocumented workers or illegal immigrants) from entering through our Southern border. “We absolutely need a workable immigration policy. That is a situation that no administration has adequately addressed for more than fifty years. But let’s look at it realistically. We need immigration in Texas. Right now, fifty percent of all agricultural jobs are filled by immigrants from across our border with Mexico. Forty percent of the construction workforce are immigrants. And thirty percent of the hospitality industry are immigrant workers.”
Another area generating considerable rhetoric concerns both tariffs on imported goods and tax cuts for the American people. Again, we need to look at these from a realistic viewpoint. “Tariffs on imports are not paid by the country shipping those goods into the United States. Those tariffs are ultimately paid for by consumers buying the products at an increased price. Tariffs could result in increasing inflation. It may be a minor amount and make only a slight impact on consumer spending, which won’t necessarily affect the local economy negatively.” The issue is the threat of tariffs is a scare tactic.
Promising tax cuts is an altogether different issue. The direct result of tax cuts is an increase in our national debt, “…which is out of control,” Perryman says. “I think we will see some tax cuts, but again, we must look at it realistically.” Perryman pointed out that, since we first borrowed from France during the Revolutionary War, we have been a debtor nation. With the exception of a brief period during the Andrew Jackson administration, when federal lands were sold off to pay off the debt, our country has had to deal with the fact we owed other countries money. Jackson’s efforts to pay off that debt created a real estate crisis. Interesting to note that by the end of the Civil War in 1865, our national debt first reached $1 billion. In 1981, we reached a $1 trillion dollars of debt. Since that time, the rate of debt growth has increased at an unsustainable pace: $10 trillion in 2008; $20 trillion in 2016; and now as we begin, 2025 our national debt stands at $35.8 trillion.
To make his point about how rhetoric can be meaningless in terms of providing solutions to problems affecting our economy, Perryman quoted Mario Cuomo, who once stated, “You campaign in poetry and govern in prose.”
Examples from recent campaigns:
“Build the wall.”
“Lock her up.”
“Ban fossil fuels.”
“Drill, baby, drill.”
The fact is what may appear as simple in the campaign can become extremely complex in practice. Three words turn into 3,000 pages when attempting to craft them into law. Despite that, Perryman is convinced that the Tyler area is well poised for a positive economic future, regardless of the challenges facing this community. The most job growth will occur in the service industry, which represents the area with the most jobs (and the jobs with the lowest pay rates). The areas where growth is occurring in Tyler are life sciences, health care, distribution, and manufacturing. “The rate of growth is slower than what we saw in the aftermath of the pandemic, but Tyler’s economy will expand at a rate well in excess of the rest of the nation during the next five years. The largest gains in output (real gross product) will be in health and social services, real estate, manufacturing, and professional and business services sectors.”
In summing up, Perryman says our near future will depend on developing alternative energy sources, such as hydrogen and nuclear power. Managing artificial intelligence will become a priority. And we must develop a realistic immigration policy that will allow immigrants to join the workforce without fear of reprisals. We also need to remember we were founded on the notion of equality for all people, regardless of race, creed, or gender. Finally, Perryman emphasized again the importance of education for our future. “We must educate our kids. If we don’t, we won’t have a workforce in the future. If we educate our kids, nothing can stop us. If we don’t, we cannot create the growth we need to sustain our economy over the next five decades. Education will enable the next generation to figure out the solutions for our community’s future needs. That is our priority today!”